Autumn 2024 Budget Summary – What You Need to KnowWritten on October 31, 2024 by Kirk Rice LLP
In presenting Labour’s widely anticipated first Budget in 14 years, the Chancellor was faced with a challenging task. Following her announcement of a “black hole” in the public finances, the need to renew the Treasury’s coffers while maintaining Labour’s manifesto promises seemed a tall order.
In the event Ms Reeves outlined a programme of around £41 billion worth of tax increases over the next five years, alongside plans to rebuild tottering infrastructure, the health service, schools and more. Any idea of a return to austerity was quashed, but how this will be achieved is very much in the detail.
Download Our Full Autumn Budget Summary
We analyse the key announcements and the impacts they may have.
Among the key headline items were:
- The main rate of class 1 employer national insurance contribution (NIC) will be increased from 13.8% to 15% from 6 April 2025
- The secondary threshold at which employer NICs are payable will be reduced from £9,100 to £5,000.
- Main rates of capital gains tax increases with immediate effect to 18% for basic rate taxpayers and 24% for higher and additional rate taxpayers.
- Inheritance tax (IHT) business and agricultural reliefs will be capped at a total of £1 million from April 2026.
- Unused pension funds and death benefits will be included as part of an individual’s estate for IHT purposes from April2027.
- The additional SDLT charge for second homes and buy-to-let properties increases from 3% to 5% from 31 October 2024
- VAT of 20% will be applied to private school and boarding fees from 1 January 2025, while the charitable relief for English business rates will be withdrawn from 1 April 2025.
- ISAs, Junior ISAs and Lifetime ISA limits will remain frozen until April 2030.
- Fuel duty rates for 2025/26 will remain frozen and alcohol rates on certain draught beers will be cut.
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As ever, the Budget publications contained a wide range of proposals and much to digest. Our Budget Summary highlights the key aspects likely to affect you. If you’ve any questions about what you should do next, email info@kirkrice.co.uk or call us on 01344 875 000.
Please note: This article is correct as at the publication date. The answers are given for general guidance only and specific advice should be taken before acting on any of the suggestions made. The information is based on current tax legislation which may change in future. Information is based on our current understanding of taxation legislation and regulations. Any levels and bases of relief from taxation are subject to change. The Financial Conduct Authority does not regulate tax planning.
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